Local vs foreign workers: Unravelling the debate

By not offering adequate protection to foreign workers, the government has created the conditions that make it advantageous and lucrative to hire foreigners over locals.

Jolovan Wham

Economic fears and resentment towards foreign workers usually rest along two main premises: they take away jobs that locals can fill, and they lower the wages of local workers.

Whilst it is understandable that foreign workers are found in jobs such as those in the construction sector because it is too dirty, difficult and dangerous for locals to do, what seems to have attracted the most vocal critics is the presence of foreigners in the service sector as these jobs can easily be taken up by the local poor.

Opposition political parties have also jumped into the debate, questioning the government’s pro-immigration policies, and criticising it, fairly enough, for not protecting the interest of local low wage workers.

The Singapore Democratic Party’s May Day message this year accused the government of letting an ‘influx of cheap foreign labour’ reduce local workers to doing ‘contract and casual jobs.’ Similarly, The Worker’s Party called on the government to put Singaporeans first, lest the societal standing of Singaporean workers is eroded by the presence of foreign workers.

Public endorsement of the exploitation of foreign workers

There is no doubt that our government is unabashed about its liberal recruitment policies for foreign workers. In fact, it has been trumped as a model of economic development for Singapore. Take this excerpt from PM Lee’s May Day speech as an example:

First, foreign workers are hardworking and willing to work long hours. By hiring them, coffee shops can open late, or even 24 hours, round the clock.

Second and more importantly, with the help of foreign workers, airport, seaport, factories, offices, hotels, restaurants and retail outlets can offer better service and business hours: 365 days a year, 24 hours a day, they can run their operations, service their customers, and so strengthen Singapore’s overall competitiveness.

Third, many SMEs do not make good profits, especially the neighbourhood shops. If they can hire some foreign workers in addition to the locals, they can reduce their business costs; otherwise, they may have to go out of business. Their Singaporean employees will then lose their jobs.

What is disturbing, though not surprising about PM’s speech is its public endorsement of the exploitation of foreign workers. Our businesses and ports can run 24 hours a day, 7 days a week, 365 days a year on foreigners because we have created an industrial and work culture that disciplines them into accepting conditions that local workers would not usually agree to. We have allowed businesses to cut corners by squeezing foreign workers dry.

Our restrictive work permit system, which ties foreign workers to a single employer, makes it difficult for them to bargain for better working conditions and higher wages. Many fear losing their jobs if they dare to ask for more. Returning to their countries of origin remains a frightening option as many would have taken out loans of up to $9000 just for a chance to work in Singapore. These workers slog long hours not only to support their families but to re-pay their debt.

In the 3 years that I have worked with HOME as a social worker, almost all of the foreign workers who approached us for assistance did not have written contracts with their employers. Of those with contracts, they are written by employers with the sole purpose of protecting their own interests, rather than creating an equitable relationship between themselves and their workers. Our unions also do little to demand better working conditions for them.

Compromising rights in the name of ‘economic development’

Products and services can be produced cheaply when business costs such as wages, taxes, and the cost of complying with regulations are kept low. In Singapore, it seems we are willing to compromise the rights of individuals in the name of ‘economic development’. Somehow, we believe that by granting rights to workers, the societal gains we have made, and the economic prosperity that we have enjoyed all these years will be threatened.

One example that is often cited is how legislating a minimum wage for workers will affect the competitiveness of Singapore’s economy. It will drive potential foreign investors away and make the cost of doing business here too high. This argument rests upon the assumption that Singaporean workers compete with workers of other countries on the basis of how ‘cheap’ our workers are. In a country that has a relatively educated work force and a government that exhorts its population to ‘life long learning’, the skills and knowledge of our workers should be the competitive factor, rather than how costly it is to hire them.

When workers are poor and lack legal protection, they are often willing to work longer hours for lower wages. Hence, the reason employers are willing to hire foreign workers in favour of local workers is because working conditions of all low wage workers in general are poor to start with, and not because we are allowing too many of them in.

Employer and employee – a power imbalance

By not offering adequate protection to foreign workers, the government has created the conditions that make it advantageous and lucrative to hire foreigners over locals. Hence, blaming foreigners for taking away local jobs and depressing local worker’s wages is not an adequate analysis of the problem. Capping limits on the numbers of foreign workers entering the country will not be a long term solution. Rather, we should be working on improving the lot of all workers in Singapore. If hiring foreign workers does not become a cheaper alternative, we need not be so concerned that foreign workers are stealing jobs from local workers.

The Employment Act, which was enacted in Singapore’s post independence years is limited in its protection of worker’s rights. The amount of medical benefits, annual leave, rest days, and provisions of work hours and salary payments that the Act provides for leaves much to be desired. Our government prefers employees to negotiate working conditions with their employers, rather than guaranteeing better protection through legislative action. However, by adhering so adamantly to this ‘free market’ model, we conveniently ignore the power imbalance that exists between both parties. As a result, workers – both local and foreign – are worse off because of it.


About the author:

Jolovan is a social worker with the Humanitarian Organisation for Migration Economics (HOME).


TOC thanks Jolovan for contributing this article to our Human Rights Focus Week.


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